Amazon released a letter to record labels on Monday saying that the Cloud Drive is legal, but is willing to meet with record labels today to discuss licensing rights

After
much debate and disapproval regarding Amazon's Cloud Drive, the online retailer is
finally meeting with record labels today to discuss licensing rights.

Amazon's
Cloud Drive is an internet-based storage application that
offers 5 GB of storage free of charge. Users can store music, pictures and
documents in the cloud and pull them up on different devices. The Cloud
Drive also features a Cloud Player, which is a music streaming
application.

When
Amazon first launched the Cloud Player in March of this year, record labels
were angered at the fact that Amazon hadn't paid for licensing rights to stream
music to its users. According to those in the music industry, Amazon only had
licensing rights to sell digital downloads, which may make the new Cloud Drive illegal.

Amazon
released a letter to record labels on Monday saying that the Cloud Drive is
legal, and even compared it to Microsoft's SkyDrive or Google Docs. The
letter also noted that Amazon's Cloud Player is similar to Microsoft's Windows
Media Player, and that it had increased sales of digital songs in Amazon's MP3
store.

"We
don't publicly discuss our meetings with partners, and we have not announced
any changes to Amazon Cloud Drive or Amazon Cloud Player since the
launch," said Cat Griffin, an Amazon spokeswoman.

Record
labels are likely eager to meet with Amazon as well since the risk of other
companies following in Amazon's footsteps is too great to chance. Other
companies could create services likethe Cloud Drive, where the music
industry is not included in regards to licensing rights.

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Record labels see digital music not as selling customers a product, but rather as licensing the use of a product to customers. If record labels had their way, they would charge us every time a song is played. Greed.

The record label's primary defense is that for every 1 hit artist there are 9 failures. Though with internet music becoming a less risky way of getting your music out there, it makes them nearly irrelevant. They are still useful for putting talented musicians together, studio time and concerts but as for discover talent, the risks they took are much smaller now.